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Pru shareholders warned to vote against AIA deal

Prudential shareholders have been warned to vote against the £24.5bn acquisition of AIG’s Asian arm by an influential voting adviser, according to the Financial Times.

Proxy advisory service, RiskMetrics, issued a critical assessment of the AIA deal saying that while the acquisition had a “sensible strategic rationale” the insurer was paying a full price for the business.

It is quoted as saying: “A full price, integration risk and ambitious targets that barely meet the cost of capital do not make a complelling combination. For this reason, it is recommended shareholders vote against the acquisition of AIA.”

The firm, which advises 2,400 clients globally, added: “Prudential needs very high growth rates at AIA to only meet a reasonable return on invested capital, something that seems a stretch when managing a difficult integration process.”

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Comments

There are 3 comments at the moment, we would love to hear your opinion too.

  1. ‘influential’? Never heard of them…

  2. Exasperated me 26th May 2010 at 9:52 am

    No future with a deal and no future without a deal? Sums up UK life offices, fighting for survival having ripped off the UK policyholders who funded their expansion through the ‘with profts’ funds, what a joke – ‘profits’. Why hasn’t the FSA done something about this?

  3. RiskMetrics, bullsh*t merchants

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